A Study of the Indian Diaspora: Role

Diaspora, development, and the Indian State


India’s sizeable diaspora population – of more than 18 million people in 2020 – is distributed mainly between UAE, USA, and Saudi Arabia. Reports indicate that 1.3% of the American population is comprised by people of Indian descent, playing important roles in the politics, economics, and society of both their home and host countries. Indian entrepreneurship drives economic growth and technological evolution. With 8% of the founders of high-tech companies being Indians, holding high positions in important American tech firms – Sundar Pichai and Satya Nadella as the CEOs of Google and Microsoft, respectively – it is unsurprising that the Indian diaspora comprises the most successful immigrants not only in USA but also in the Persian Gulf, which is home to approximately 4 million Indians. Despite a significant outflow, India’s population of 1.39 billion is set to overtake China’s by 2027. Though remittances from expatriates are key to national economic development, and India was the leading recipient of remittances in 2018, more remains to be done for the 176 million living in dire poverty and hunger in the country. According to the Reserve Bank of India, inward remittances support governmental efforts at poverty alleviation through underwriting daily expenses and allowing investment in business and education. In fact, 43% of the national trade deficit was financed by the remittance market in 2017-18, explaining Prime Minister Narendra Modi’s sustained emphasis on an attractive diaspora policy. Therefore, it is evident that the Indian diaspora – sizeable and powerful – benefits both India and their host countries and constitutes a powerhouse of initiative and income.

This article aims to study the Indian diaspora with a special emphasis on their role and contribution to national development. It will first historically analyse the relationship between the diaspora, development, and the Indian State through various paradigm shifts in the geography of identity. Second, it will examine Modi’s initiatives to better engage the diaspora and the opportunities and challenges accompanying the framing of a cohesive diaspora policy. It will also observe how the diaspora aided the government and the Indian public during the COVID-19 pandemic, elucidating their significant contemporary role.

Diaspora, development, and the Indian State

In the decades immediately after independence, from the 1950s until the 1960s – most decolonised countries like India and Taiwan pursued a closed model of nation building and development planning. This was not surprising. The key objective of these governments was to protect the embryonic economies of their newly-free nations from overdependence on external resources and overexposure to the external world. These inward-looking models of development focused on internal consolidation and progression toward self-reliance in various sectors of the economy. This was related to an equally strong emphasis on the establishment and consolidation of a territorial nation and citizenry who would participate in the process of national reconstruction and claim entitlements from the State. Territorial sovereignty was hard-won after centuries of colonial subjugation, and the government was keen to protect and expand it. In this primarily nationalistic development discourse, it is understandable that individuals located outside these territorial boundaries – diaspora – were viewed cautiously for their apparent lack of commitment to their home country. Eventually, the inevitable waves of globalisation transformed these perspectives. As effortless flows of commodities, labour, capital, ideas, and individuals across the world were accompanied by unprecedented revolutions in communication and transportation; territorial boundaries became fluid and radically less important. A symbiotic relationship emerged between the movement of individuals and capital, and new diasporic communities – attached to multiple cultures, economies, and nations – began to propel the new, post-national international community. These transnational diasporic networks mediate a complex network of production, circulation, and consumption activities and contribute significantly toward the integration of various national economies into the global economy. This is bolstered by observable increases in transnational businesses, cross-border financial flows, and dual citizenship. In India, where the constitutional scheme disallows such citizenship, a quasi-dual citizenship model has been adopted through the OCI scheme to acknowledge that migrants now retain loyalties to both their home and host countries. This marked ideological shift – from rigid markers of identity, entitlement, and participation in territorial nations to more flexible and de-territorialized notions of belonging – may be explained primarily by the obvious economic advantages that the new diasporas brought to their countries of residence and origin. An accompanying ideological shift also became evident. Diasporas began to be viewed as independent actors with the agency and choice to migrate and manoeuvre the diverse socio-cultural, political, and economic negotiations of their home State rather than victims of uncontrollable circumstances that compelled migration. This was iterated at the 2017 Pravasi Bharatiya Divas, where Modi described a movement from “brain drain to brain gain” and announced his collective vision of “Bharatiyata” (Indianhood). Though diasporic interactions were initially predominantly cultural and social, their role in critical economic and political activities – remittances, technology transfer, expenditure on communication and tourism, capital investment, lobbying, and philanthropy – has become difficult to ignore. Thus, the Indian government has redefined and broadened the conception of national economic development and planning to integrate the powerful transnational population. Indeed, diasporic remittances were largely unaffected by the 2008 economic crisis and have persistently rescued the country from the balance of payments deficits over the years. As both international and national organisations pursue policies of closer engagement with diasporic communities, it is important to recognise the human cost of migrant displacement and alienation. The governmental emphasis on capital flows from the wealthy Indian diaspora must not ignore the conditions of those millions that are not as affluent or profitable.

Initiatives, Opportunities, and Challenges

Modi has cultivated close relationships with the diaspora, which he sees as possessing tremendous potential to contribute to national economic growth. They view him as a national leader capable of bringing about positive transformations. The government’s policy initiatives toward diasporic engagement aim to serve the needs of the NRIs and OCIs through the provision of consular services, protection, and conduction of outreach activities. They also seek to persuade the affluent and powerful diaspora to further India’s growth through knowledge transfers, philanthropy, investment in innovation, and development assistance. The government has thus launched a string of initiatives and renewed schemes, such as the Know India Program (KIP). A policy continuum between the initiatives launched by the Atal Bihari Vajpayee government and the Modi government is also evident. The first successful KIP was launched in 2003, included 55 participants in 2006, and was modernised to host more than 160 participants across four sessions in 2017 – through the introduction of a website allowing participants to apply online. The programme was aimed chiefly toward Girmitiya youth – descendants of those transported to colonial plantations in Fiji, Mauritius, South Africa, and the Caribbean under the British Indian indenture system – to enable them to “better understand and appreciate contemporary India, foster closer ties with the land of their ancestors and enhance their engagement with India.” Scholars believe that visits to the homeland through diasporic tourism are necessary to facilitate productive diasporic engagement. The purpose of the KIP or other youth-centric outreach initiatives – such as scholarships for Indian-origin youth to pursue undergraduate courses in University Grants Commission-recognised universities in India or Bharat Ko Jano online quizzes to inform diasporic youth about India’s heritage, culture, and history – therefore is to encourage them to act as unofficial ambassadors for India. There have been concerns that these governmental programmes, including the establishment of the Pravasi Bhartiya Kendra in New Delhi, have been primarily exhibitory and unproductive. Observers agree that Modi’s soft power tactics have succeeded in positively impacting those sections of the diaspora that have complained of historical neglect.

Additionally, Head Post Offices have been allowed to issue passports enabling thousands more access to them and have instituted orientation programmes and training centres for possible emigrants to reduce culture shock and educate them on the necessary skills. Numerous schemes have also been announced to safeguard the interests and welfare of poorly educated, low skilled blue-collar overseas Indians and protect them from exploitative employers abroad. The minimum wage of Indians employed as industrial workers, domestic servants, cleaners, and labourers in Emigration Check Required (ECR) countries was increased through the Minimum Referral Wages (MRW) policy in 2014. The government also mandated that nurses be recruited only through one of the six state government placement agencies to reduce the risk of fraudulent contracts and human trafficking. The MEA launched the e-Migrate system in 2015, requiring that all foreign employers register in the government database. Though countries like the UAE have condemned this as a “breach of sovereignty”, most scholars believe that it would successfully protect the interests of Indians recruited abroad. In September 2020, however, the Ministry of External Affairs (MEA) announced a 30%-50% reduction in the MRW in Bahrain, Qatar, Oman, UAE, Saudi Arabia, and Kuwait to ensure that Indians remain employable even during the COVID-19 pandemic. Indian workers are paid higher wages in the Gulf than their South Asian counterparts, and recruitment rates were declining as they were being replaced by workers from Bangladesh and Pakistan. However, civil society groups and migration experts cautioned that reduced MRW could render the Indian diaspora more vulnerable to exploitation and loss of employment and eventually foment a less competitive diasporic workforce. Therefore, it is evident that the increased emphasis on the diaspora is accompanied by a variety of opportunities and challenges.

The key benefit of engaging with the populous Indian diaspora is terms of increased remittance. These assist in socio-economic development for the recipient’s family and account for 50% of rural household income, fund the construction of temples and schools, and impact poverty reduction by transforming consumption behaviour in rural areas. National Sample Organisation survey data indicates that remittance-receiving households are economically better off than those that do not and that remittances are generally utilised to purchase food items, consumer goods, and healthcare. The last also has implications for the labour market as it augments productivity, as does the fact that the least percentage is expended on education. An enhanced technology sector and increased socio-economic development are other tangible and long-term advantages of diasporic engagement. The extensive development of informational technology hubs like Bengaluru, Gurugram, and Hyderabad hosting multinational companies (MNCs) like Amazon, Google, Facebook, and Uber, has also created a culture of innovation and entrepreneurship for various Indian start-ups like Flipkart, Ola, Swiggy, and Zoho. The government may benefit from such transnational entrepreneurship by negotiating assistance for indigenous entrepreneurs and small businesses through transfers of finances and technical knowledge and skills from the diaspora. Regulations to ease remittance and Foreign Direct Investment (FDI) norms – such as the 2015 policy to treat NRI and OCI investments as domestic and not FDI – have rendered it easier for the diaspora to productively invest in the national economy and have had the advantage of creating a profit flow that is difficult to expatriate overseas. Scholars believe that these measures would also enable increased investment and augment the inflow of foreign exchange remittance, supporting national growth. Indeed, a sustained emphasis on the diaspora-homeland relationship could auger several synergistic advantages for the country. Diasporas act as intermediaries connecting traditional development agents and local communities because their motives for investment are different from other foreign individuals and companies. Although all FDI decisions are generally profit-driven, diasporic individuals (or companies) may seek to establish a long-term base in the country, possess better knowledge about market conditions and domestic labour and economic policies, and thus pursue more viable expectations and time frames for project completions and returns of investment. However, the decision to invest may be negatively impacted by their rationale behind migrating. Reports also indicate that diasporic investment capacity is lower than traditional sources of FDI. Another less tangible but equally significant advantage of a large overseas population is the possibility of ‘diaspora diplomacy’, especially as scholars observe diasporas realising the socio-economic value of advocacy as accompanying influence abroad. As they seek to augment the acknowledgment of their presence in their host countries, it also renders India more visible in the international arena. Certainly, it is necessary that India shares good bilateral relations with the host countries for diaspora diplomacy to be productive. It is in this that diasporic communities have viewed Modi with enthusiasm and admiration, especially the middle class – from which large sections of the diaspora emerge. The sentiments of “common heritage”, emotional and cognitive belonging, and a “global Indian family” that Modi expounded in his numerous evocative speeches at densely packed events in New York, Sydney, London, Kuala Lumpur, UAE, and South Africa, have evidently resonated deeply with the diaspora populations in those countries. Indeed, Modi’s popularity amongst the diaspora is unprecedented for any Indian prime minister and is explained by the fact that he has cultivated ties with a copious community that has felt historically alienated by the Indian State. The strategic ambiguity of India’s longstanding non-alignment policy has often led to its exclusion from the international centre stage. As Indian-origin individuals increasingly begin to occupy key positions in international politics, media and think tanks, they accelerate India’s bargaining strength and shape effective bridging policies between their home and host countries. India’s efforts towards acquiring permanent membership in the United Nations Security Council (UNSC) – enabling significantly more influence in international politics (especially because China already possesses permanency) – may be assisted by diasporic diplomacy. According to Article 108 of the UN Charter, any reform would require an affirmative vote from two-thirds of members present and voting and the consensus of all five permanent members. India’s diplomatic influence was previously demonstrated, as it negotiated and secured the requisite majority for the reappointment of Justice Dalveer Bhandari to the International Court of Justice in November 2017. Advisors to the government believe that the diaspora in Canada and Mexico may be leveraged to influence these States to support India’s bid to permanency, though US pressure impelling change in negotiators has impeded this process. It is also manifested that the acquisition of permanency and veto rights in the UNSC would allow the country to better protects the rights of its diaspora. These justifications of mutual benefit have been employed to encourage the diaspora to lobby for India’s permanency. India is also a crucial stakeholder in the regional security dynamics of Southeast Asia and South Asia and is accumulating influence in East Asia as well. Though it does not yet possess the economic capacity to successfully counter China in the region, its military capabilities, common interests, and determined policies have cemented its ‘rising power’ role in the region. In regional geopolitics too, have the populous expatriate communities in Thailand, Malaysia, and Singapore, offer opportunities for nurturing productive diaspora relationships.

Various challenges accompany increased diasporic engagement. Assertions of support from the diaspora are neither constant nor automatic and may not always prioritise India’s interests. The Indian diaspora did not oppose President Donald Trump’s proposal to restrict the H-1B visa programme, which had aided many Indians – forcefully enough. There are also concerns that remittances may not always be used for beneficial and legal purposes and, instead, be employed to fund extremist groups through hawala channels. Canadian Prime Minister Justin Trudeau’s visit to India in February 2018 was accompanied by a slew of propaganda and support for the Khalistan separatist movement, from the Sikh diaspora there and in the UK. As the Indian government seeks to deepen its diasporic relationship and explore the strategic benefits, it must balance that with the security imperatives of the State. India has expended millions rescuing Indians from crises in Iraq, Libya, and South Sudan. The last, through the Sankat Mochan rescue mission, was necessary but expensive in terms of time, money, and personnel, as was the establishment of a helpdesk at the Bali airport to assist the diaspora during volcanic eruptions. Experts have also signalled caution about the possibility of Indian workers having their contracts terminated due to the economic decline accompanying the pandemic, posing difficulties for Indian missions returning affected workers back home. These concerns are exacerbated by reports indicating that the MRW and e-Migrate system have detrimentally impacted the opportunities for diasporic engagement, as statistics indicate that the number of workers in Saudi Arabia and the Gulf fell by half and 33% respectively and that companies find it less expensive to hire workers from Pakistan and Bangladesh. As the rates of diaspora returning increase, India might face the possibility of heavily diminished remittances and the necessity of establishing rehabilitation centres. The government also faces pressure from the influential and wealthy diaspora in the USA, Canada, and the UK, to institute dual citizenship and voting rights. Though the OCI scheme does meet some of their demands, it excludes them from the key entitlements of citizenship. The diaspora in the Gulf – who contribute the largest percentage of remittances back home – have demanded more support and security from the government. Inconsistencies in policies and ineffectual implementation also continue to frustrate and hinder diasporic contribution pathways.

The successive waves of the COVID-19 pandemic wreaked havoc on the Indian population. The harsh lockdowns and paucity of accurate information were exacerbated by economic distress, loss of employment, and scarcity of vaccines, life-saving medicines, and oxygen, all of which disproportionately affected the poorest sections of Indians. In this environment, the Indian American and the Indian British diaspora – both in the public and private sectors – played a significant role in mobilising funding for relief and advocating for more international assistance. The Soondra Foundation, based in Chicago, provided cash grants to the Indian working poor for medical emergencies. It also organised important research into innovative solutions to quarantining, preventive care, and social distancing. Representatives reported that there were efforts tie up with room aggregators like Oyo and Treebo, employ resident doctors, and provide rudimentary oxygen facilities while also communicating with the Uttar Pradesh government to disseminate readymade COVID medicine kits through state community and primary health centres. Indian doctors in USA and UK offered their services, and other diasporic organisations organised donation drives, amplified SOS calls, and generated awareness about the devastating conditions faced by the population at home. The TYCIA Foundation – based in New Delhi, with longstanding connections to the wealthy diaspora – assimilated more than 150 Indian-origin medical professionals to provide counselling and support to caregivers of COVID-19 patients. Suvita, a UK-based non-profit organised employed the “nudge theory” to raise awareness about vaccinations in Maharashtra and Bihar, using positive reinforcement and indirect intimations to send out SMSs to more than 300000 families, informing them about COVID homecare. It also mobilised a local team to create an updated information database about hospital infrastructure, availability of beds, and oxygen cylinders. The Indian-origin communications lead at the non-profit Global Integrity, based in New York, formulated a ticketed online discussion on the Indian experience of the pandemic on 7th May 2021, and raised over $2500 for grassroots non-governmental organisations working in COVID relief in India. Several other individuals and organisation also raised funds and support during the pandemic. The British Asian Trust campaign, Oxygen for India, raised more than £2 million for their Indian partner Swasth to procure over 20000 oxygen concentrators by May 2021. The #Artists for India campaign run by the 4 non-governmental organisations, Mission Oxygen, also raised funds by providing direct donors with signed copies of books by various Indian diasporic authors such as Sonia Faleiro and Salman Rushdie. UK-based organised Khalsa Aid organised significantly successful donation drives for a variety of necessities, including oxygen concentrators and logs for funeral pyres.

It is evident that the degree of assistance that the Indian diaspora provided is explicable by the emotional ties possessed by them with their home country and people. This is chief in understanding the role of the Indian diaspora in India’s economy, society, and polity. Unlike other international actors, the Indian diaspora feels intrinsically affiliated to the country and its future. If effectively implemented, a cohesive diaspora policy would harness these leanings to benefit the country.


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